Green Shoot Alert! CEO Confidence Up 9% in May

Business Leaders Confident in Improved Economic Conditions – Courtesy of Chief Executive Magazine

NEW YORK, June 4, 2009 – Chief Executive magazine’s CEO Index, the nation’s only monthly CEO Index, made another strong resurgence in May based on the responses collected from America’s top executives. In May, all components of the CEO Index continued to increase after a strong recovery in last month’s index.

The CEO Confidence Index rose 9 percent, to 75.7 points in May, making a 48 percent gain since it reached its lowest point in February 2009. Of the five sub indices, the Business Conditions Index, used to measure the confidence in business conditions, made the biggest gain, jumping more than 22 percent, to 68 points.  Since reaching an all time low just two months ago in March 2009, the Business Condition Index has rebounded 83 percent. 

“Over the past few months, we have noticed a positive shift in confidence among the CEOs polled” said JP Donlon, Editor-in-Chief of Chief Executive magazine. “CEOs are increasingly in the opinion that we’ve hit the bottom, as evidenced by their increasing confidence in the future of the economy.”  

For the second straight month the Future Confidence Index, which measures the outlook of employment, economic and capital spending opportunities over the next quarter, is higher than current confidence implying that CEOs think business conditions will improve in the coming quarters.  Similarly, CEOs’ confidence in the current business conditions have also improved with the Current Confidence Index, which measures the confidence of current employment, economic and investment conditions, increasing 4 percent to reach nearly 70 points, the highest point since November 2008 when the sub index started experiencing steep declines.

Demonstrating CEOs’ growing confidence in the economy, Jim Riley, CEO of Laclede Chain Manufacturing, said,“This is actually a great time for companies and the country to do some cleansing and prepare for a solid future.”

In line with other indices, the Employment Confidence Index, a sub index used to calculate overall confidence in the job market and that has been a leading indicator of employment conditions, also increased 10 percent, to nearly 52 points in May.Since reaching an all time low in December 2008, the Employment Confidence Index has rebounded by 58 percent. Furthermore, even though still very low, the number of executives who said employment will either increase or stay the same over the next quarter doubled to 14 and 33 percent, respectively, compared to last month.

For additional information regarding the confidence of public and private-company CEOs, details about CEO attitudes on employment, investment and business conditions, visit our full report at http://www.chiefexecutive.net/ceoindex.

CEO Index, May 2009

Respondents: 152

About Chief Executive Magazine

Chief Executive is a controlled circulation magazine that has been published since 1977. It reaches 42,000 chief executive officers and their peers, reaches a total readership of 220,000.  Chief Executive Group facilitates "Chief Executive of the Year," a prestigious honor bestowed upon an outstanding corporate leader, nominated and selected by a group of his or her peers.  Anne Mulcahy, Bob Ulrich, A. G. Lafley, George David, Fred Smith, Bill Gates, John Chambers, Michael Dell and Sandy Weill are just some of the leaders who have been honored during the award's 23-year history.  Chief Executive also organizes roundtable meetings and conferences to foster opportunities for top corporate officers to discuss key subjects and share their experiences within a community of peers.  Visit www.chiefexecutive.net for more information.